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2019 (2) TMI 1424 - AT - Service TaxRefund of Service Tax erroneously under Reverse Charge Mechanism - unjust enrichment - Held that:- The test of unjust enrichment, in its limited applicability, is confined to the consideration as to who had borne the incidence of tax? If it is borne by the appellant and not passed on to any other person, then appellant cannot be regarded as being enriched with the refund of such tax component borne by any other person. In the instant case, going by the service commission agreement - calculation is given as: “CIF price to customer minus CIF price to Godrej” and the service commission calculation has been reached at a certain amount, as found from simple agreement copies placed at page no. 130 & 131 of the appeal memo - Chartered Accountant also had furnished the certificate indicating non-realisation of tax component from the service receiver - The appellant’s claim that it had paid the Service Tax under the erroneous belief that as per Reverse Charge Mechanism, it is liable to pay the same but subsequently Board Circular had clarified the same to be non-taxable. Therefore, the service tax is supposed to be treated as deposit as there is no sanctioned behind it by the legislature in conformity to Section 265 of the constitution of India. The appellant has passed the test of unjust enrichment and it is entitled to the refund claimed by it for non-leviable Service Tax - appeal allowed - decided in favor of appellant.
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